Volvo To Launch Inter-City Buses Next Year

The market size for mini excavators in India is estimated to be around 700 per annum.

At the sidelines of a Confederation of Indian Industies (CII) meet here yesterday, Volvo India managing director Ravi Uppal said test-marketing results for inter-city buses give enough reason for the company to look at moving into long-distance passenger transport next year.

"These buses will have in-built safety features like a four valve braking system -- compared with the traditional single valve one -- and other design and technology inputs to guard human lives in case of accidents,'' Uppal said.

`Dynafleet,' the global positioning system for online fleet tracking, is also expected to kick off in south India in September, based on a six-month pilot project undertaken by the company.

 

``Right now, we're ramping up and consolidating our FH-12 and FM-7 truck lines and looking at expanding the market for our construction equipment,'' Uppal said.

In the process, Volvo's plans to launch small capacity trucks and refrigeration has been shifted to the backburner until the consolidation plans happen. Uppal also ruled out any launch of double decker buses in the near future.

As per the ongoing investment plan, Volvo plans to pump in around Rs 50 crore for expansion of existing capacity for service centres. Volvo has already invested around Rs 300 crore in its Indian operations. "We may look at short-term debt as we have an open-ended investment plan," Uppal said.

Uppal said the production of trucks will be doubled from 500 during this calendar year to 1,000 next year. Volvo has tied up with several financiers including Citicorp and Vysya Bank for financing of trucks. Around 90 per cent of the asset value of the truck is financed for periods up to five years.

Volvo had adopted a `push and pull' marketing strategy for sale of its range of vehicles. "We have a direct approach method and the OEM route to sell our products," Uppal said. The push & pull strategy involves creating a push involving the OEM and creating a pull by influencing the transporters.

Volvo's first truck to be unveiled was the FH-12, a multi-axle tractor trailer. It later launched its 7-litre FM-7 tractor trailer. The FL7 is designed for medium heavy cargo segment (15-20 tonne) and specifically designed for bulk tank and sea containerisation.

The current capacity of the existing plant is around 2,000 vehicles per annum.